BitPay on Hacking: Loss Is Ours, Client Funds Are Safe

BitPay has issued limited public comment on the recent revelations of its losing 5,000 bitcoins due to a hacking last December.

On its blog, CEO Stephen Pair says that he will not discuss the pending litigation between the company and its insurer, Massachusetts Bay Insurance Company (MBIC), which has refused to honor BitPay's claim.

However, Pair endeavors to assure clients over the safety of the holdings and that BitPay is covering the entire loss, notwithstanding the outcome of the litigation. He writes:

"This was an isolated incident, and none of BitPay’s customers, Affiliates or merchants lost any funds. The only victim of the theft was BitPay. All merchant funds were secure, and there were no disruptions to BitPay’s payment services at any time."

The hacking was the latest example of scam artists using sophisticated means to infiltrate the victims' systems through phishing and assumed identities. In this particular case, the attacker didn't even have to perform any transactions on his/her own, instead instructing the BitPay exec team to do so.

Pair noted that the company is working to better protect its systems in the future. "Additionally, advances in Bitcoin cybersecurity over the last year allow BitPay to further protect funds and better serve merchants and bitcoin users," he wrote.